Posted by rflacks on:
Nowadays, conventional wisdom has it that government policy is determined to a great extent by the vast lobbying efforts of special interests. Wealth translates to political power by use of campaign contributions, and all manner of methods, from subtle briberies to simulations of public opinion--all in aid of the profit oriented interests of particular firms or corporate sectors. But when old Karl Marx set out to define the role of the government in a capitalist society, he described the state as "the executive committee for managing the common affairs of the whole bourgeoisie". The government's primary function was, in his view, to oversee the system as a whole, and, implicitly, to subordinate narrow interests which conflicted with the overall 'class' interest of capitalists. And despite many differences among them, 20th century radical analysts of power (like C. Wright Mills, or new left historians, or Bill Domhoff) have all believed that there was a center of power in the corporate elite that concerned itself with governing the society, not simply to maximize short term profit, but to try to ensure the long term viability of capitalism itself.
So FDR and the New Deal promulgated reforms that many business leaders hated, but that were designed to save capitalism in the midst of the great depression. The New Dealers believed that on the one hand they were averting revolution by allowing, for the first time in US history, regulated labor unions to form and strike and by providing a safety net for millions of jobless and impoverished workers. The New Deal created a government-corporate partnership that promoted economic growth and industrial peace. When I was in college in the 50s and 60s, we learned that this partnership was now accepted by the corporate elite and by the GOP--and that it was proof that socialism was no longer relevant--that capitalism could reform itself.
Healthcare has become the most obvious area where such reform is necessary in our time. Healthcare costs are unsustainable for the corporations that provide insurance for their employees, and for the government programs providing care for those without employer based insurance. The reasons for these skyrocketing costs are many, but fundamental is the control of healthcare by profit oriented insurance, drug and hospital corporations, and the cost burdens that result from the millions of uninsured.
The optimal solution to this crisis would be to move toward a 'single payer' medicare for everyone, financed by a combination of employer contributions and payroll taxes. The burden of costs would be reduced for employers, a steady revenue stream would finance a healthcare budget aimed at efficiency and cost control, all those uninsured would be covered automatically, preventive medicine would be readily available, and all manner of institutional setups for delivering medicine could be encouraged--while enabling more patients choice of their own doctors than most can now get.
President Obama has acknowledged all the above, having said that if we were starting from scratch single payer would be the way to go. He and other liberal healthcare reformers 'took single payer off the table' at the start of the process, arguing that most Americans wanted to keep the insurance they have and would resist radical change. But this flies in the face of numerous polls, done over several decades that indicate that the majority of Americans would support universal government financed healthcare. Here's a more convincing reason for erasing single payer: to try to achieve it means to end the private insurance industry as we know it. So here's a principle for analyzing corporate power in a capitalist society: Government is most unlikely to institute a reform--even if the 'system' would be best served by it--if the reform deeply threatens a major corporate sector. Capitalist reform seems to require major compromise with the profit interests of corporations affected. We will shortly see this played out in the effort to reform the energy industry.
The compromise the liberal health reform leadership has agreed on involves these elements: everyone will be required to be insured, all employers who are able to will be required to ensure their employees, those who can't get employer based insurance will be able to get subsidies to buy insurance from a choice of companies, including a non-profit publicly owned one (while existing government programs (medicaid, medicare, veterans) will be expanded to enable low income people to be covered. All insurance companies would be tightly regulated so that they would no longer cherry pick customers, and would not discriminate against sick people.
Barack Obama seems to have thought that this version would win the backing of the corporate power elite, since it provides reasonable hope of containing costs, and making the health system rational. While cleverly claiming to support reform, however, the health insurance and pharma companies have invested in an enormous campaign to prevent any reform that would reduce their profits. Indeed, they seem to have achieved an astonishing success in the senate--the legislation emerging there promises to create a captive market for these companies, with no significant public competition, and a set of regulations that may, like much government regulation, be readily diluted. So here's a second principle for understanding corporate power: any corporate sector that has the means to control policy to its own advantage is likely to try to do so, even if this undermines reforms that the system as a whole requires.
Is there any hope for some semblance of decent reform? I think this lies in the kind of bill that the House seems ready to pass. And it's imperative that the House do this (which means that it's imperative that progressive congress members, including our own Lois Capps, stand firm in their resolve not to accept a bill without a real government option.) If the senate adopts the pro-corporate bill that is now shaping up, there will then come an opportunity for something real--a massive mobilization in favor of the house bill (and maybe having a million folks come to DC to overshadow the weird lunatic caravan that recently showed up there). The new deal history tells us that massive grassroots action must happen if corporate power is to be overcome. And that action requires something real to rally for.